The quick or acid-test ratio is a more rigorous test for short-term insolvency than the current ratio

Question:

The quick or acid-test ratio is a more rigorous test for short-term insolvency than the current ratio because it eliminates ___________, considered the least liquid current asset and most likely source of losses. 

(a) Cash.

(b) Accounts receivable.

(c) Marketable securities.

(d) Inventory.  

Fantastic news! We've Found the answer you've been seeking!

Step by Step Answer:

Related Book For  answer-question

Understanding Financial Statements

ISBN: 9781292101552

11th Global Edition

Authors: Lyn Fraser, Aileen M. Ormiston

Question Posted: